On Tuesday a federal appeals court in Texas ruled against the U.S. Environmental Protection Agency (EPA), and scolded the agency for rejecting state pollution controls. Federal regulators had claimed that the Texas codes fell short of meeting requirements of the Clean Air Act, but in a 32-page written opinion, Judge Jennifer Elrod of the 5th U.S. Circuit Court of Appeals and a George W. Bush appointee chastised the EPA for taking four years to review the Texas permits. Because federal regulators took longer than the statutory deadline of 18 months, the court ruled that the EPA must review the permits again.

The controversy stems from the state-issued permits that regulate pollution controls at coal plants and energy providers in Texas. The EPA and Texas officials have long been at odds, and the Lone Star state has filed numerous lawsuits against the federal agency in recent years. Last fall governor Rick Perry made the EPA one of his leading foils during his failed campaign for the Republican party’s presidential nomination. Perry claimed that EPA regulations were a prime example of “big government” overreach into state affairs. Perry claimed, for example, that Texas’ improved air quality was proof that the state’s efforts worked. But an analysis by the EPA and independent researchers counters that federal laws, not state regulations, were behind decreases in air pollution metrics including greenhouse gases, ozone concentrations and nitrogen oxide emissions.

The Texas Commission on Environmental Quality, which is responsible for state air quality regulations in Texas, welcomed the decision. The ruling actually does not require the EPA to accept the rejected Texas air quality measures. Instead, the three-judge panel instructed EPA officials to review the state’s guidelines and issue a quick decision.

With the EPA’s proposal yesterday to set limits on emissions from new coal-fired power plants, look for the legal battle to continue. Texas is one of 10 states that could be affected by these regulations if the EPA implements these new rules.